DAILY CURRENT AFFAIRS IAS | UPSC Prelims and Mains Exam –28th May 2024

Syllabus

• Prelims – Economy

Context: Adani Ports and Special Economic Zone Ltd (APSEZ) will become the first Adani Group company to be included in the Sensex at the Bombay Stock Exchange, replacing Wipro on June 24.

Background:-

• APSEZ and Adani Enterprises, the flagship of the Adani Group, are already part of the Nifty at the National Stock Exchange, the other stock market index that tracks the performance of a set of large and actively traded companies in the country.

ABOUT STOCK MARKET AND INDICES

• The stock market refers to public markets that exist for issuing, buying, and selling stocks. Stocks, also known as equities, represent fractional ownership in a company, and the stock market is a place where investors can buy and sell ownership of such investible assets.
• The stock market serves two very important purposes. The first is to provide capital to companies that they can use to fund and expand their businesses. By offering stock shares instead of borrowing the capital needed for expansion, the company avoids incurring debt and paying interest charges on that debt.
• The secondary purpose the stock market serves is to give investors – those who purchase stocks – the opportunity to share in the profits of publicly traded companies. Investors can profit from stock buying in one of two ways. Some stocks pay regular dividends (a given amount of money per share of stock someone owns). The other way investors can profit from buying stocks is by selling their stock for a profit if the stock price increases from their purchase price.
• Most of the trading in the Indian stock market takes place on its two stock exchanges: the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE). The BSE was established in 1875. The NSE was founded in 1992 and started trading in 1994.
• Both the Sensex and Nifty are tools/index by which traders and market participants measure the domestic market’s performance.
• Launched in 1986, the Sensex is the country’s oldest and most tracked index. It is designed to measure the performance of the 30 largest, most liquid, and financially sound companies across key sectors of the Indian economy that are listed at BSE Ltd.
• Among the companies that are part of the Sensex are Reliance Industries, ICICI Bank, and ITC Ltd.These companies are selected to represent the broader Indian equity marketplace. As such, even though the Sensex is composed of only 30 stocks, investors make decisions to buy or sell based on the movement of the Sensex.
• The Sensex is reconstituted biannually, in June and December of every year.

How is Nifty different from Sensex?

• While the Sensex constitutes 30 companies trading on the BSE, the Nifty 50 is a broad-based index consisting of 50 blue chip large and liquid stocks traded on the National Stock Exchange of India (NSE).
• The Nifty 50 was started in November 1995.

Source: Indian Express

Syllabus

• Prelims & Mains – ECONOMY

Context: India has recorded a trade deficit, the difference between imports and exports, with nine of its top 10 trading partners, including China, Russia, Singapore, and Korea, in 2023-24, according to official data.

Background:

• The data also showed that the deficit with China, Russia, Korea, and Hong Kong increased in the last fiscal compared to 2022-23, while the trade gap with the UAE, Saudi Arabia, Russia, Indonesia, and Iraq narrowed.

Key Takeaways

• Trade deficit arises in the course of international trade when the payments for imports exceed the receipts from export trade. A trade deficit is also referred to as a negative balance of trade.
• According to trade experts, a deficit is not always bad, if a country is importing raw materials or intermediary products to boost manufacturing and exports. However, it puts pressure on the domestic currency.
• A rising trade deficit, even from importing raw materials and intermediates, can cause the country’s currency to depreciate because more foreign currency is needed for imports. This depreciation makes imports more expensive, worsening the deficit.
• Economic think tank Global Trade Research Initiative (GTRI) said that a bilateral trade deficit with a country isn’t a major issue unless it makes us overly reliant on that country’s critical supplies. However, a rising overall trade deficit is harmful to the economy.
• To cover the growing deficit, the country might need to borrow more from foreign lenders, increasing external debt and this can deplete foreign exchange reserves and signal economic instability to investors, leading to reduced foreign investment.
• Reducing a trade deficit involves a combination of increasing exports and decreasing imports.

Some strategies that could be used to reduce trade deficit:

• Improve Infrastructure: Improving infrastructure can help facilitate trade and make it easier for businesses to export goods.
• Diversify Trade Relations: By diversifying trade relations, India can reduce its dependence on any single trading partner and potentially increase exports.
• Quality Control Orders (QCOs): These can be used to cut down on cheap and non-essential imports.
• Devalue Domestic Currency: This can make exports cheaper and imports more expensive, thereby reducing the trade deficit.
• Attract Foreign Direct Investment (FDI): FDI can bring in more funds and technology, which can boost domestic production and exports.
• Energy Diversification: Reducing reliance on imported crude oil by diversifying energy sources can help in reducing the trade deficit.

Latest Data:

• China has emerged as India’s largest trading partner with $118.4 billion of two-way commerce in 2023-24, edging past the U.S.
• The trade deficit with China rose to $85 billion, Russia to $57.2 billion, Korea to $14.71 billion and Hong Kong to $12.2 billion in 2023-24
• The bilateral trade between India and the U.S. stood at $118.28 billion in 2023-24. Washington was the top trading partner of New Delhi during 2021-22 and 2022-23.
• India has a trade surplus of $36.74 billion with the U.S. in 2023-24. America is one of the few countries with which India has a trade surplus. The surplus is also there with the U.K., Belgium, Italy, France and Bangladesh.
• India’s total trade deficit in the last fiscal narrowed to $238.3 billion as against $264.9 billion in the previous fiscal.

Source: Hindu

Syllabus

• Prelims – ENVIRONMENT

Context: The Kerala government issued an order allowing the Kerala Forest Development Corporation (KFDC) to plant eucalyptus trees for its financial sustenance in 2024-2025. Environmentalists soon protested the decision saying the move would adversely affect forests and heighten human-animal conflicts in future.

Background:

• In 2021, the State government had published an eco-restoration policy. Among other things, it sought to address what it called the “proliferation of invasive species that are not suitable for our environment” and the resulting “depletion of natural forests”.Environmental activists alleged following the State’s order — permitting the KDFC to plant eucalyptus trees — contravened the policy’s aspirations.

Key Takeaways

• Eucalyptus is a genus of more than 700 species of flowering plants in the family Myrtaceae. Most species of Eucalyptus are native to Australia.
• About three-quarters of Australian forests are eucalypt forests. Many eucalypt species have adapted to wildfire, are able to resprout after fire, or have seeds that survive fire.
• Eucalyptus trees are a source of timber, pulpwood, and firewood. They grow rapidly and can be harvested in short rotation cycles.
• Eucalyptus trees have a long history in India.
• Introduction: Eucalyptus was first introduced in India around 1790 by Tipu Sultan, the ruler of Mysore. He planted it in his palace garden on Nandi hills near Bangalore. According to one version, he received seed from Australia and introduced about 16 species.
• Expansion: Initially, eucalyptus was planted as an ornamental tree to enhance the beauty of gardens. However, its plantation on a larger scale began only in 1952.
• Industrial Use: In the 1950s, eucalyptus and acacia trees were planted extensively throughout the Nilgiris to supply pulp wood.Later, eucalyptus was planted extensively with financial assistance from the World Bank.

Controversies:

• Eucalyptus was targeted in the 1980s when water crisis first hit the district, though this tree was not the only causative factor. The state government decided not to go for fresh plantations in 1988 due to a Save Nilgiris Campaign.
• A study by the Kerala State Forest Protective Staff Organisation found that replacing exotic plants in forested areas with the corresponding natural species could help ensure food for wild elephants. Some of the the prime elephant habitat of the state like Chinnakanal in Munnar is filled with eucalyptus trees.
• The soil around the tree, because of the leaves that fall, has an acidic pH and this makes growing other crops or plants near eucalyptus difficult.

Source: Hindu

Syllabus

• Prelims & Mains – Art & Culture

Context: A portion of the Virupaksha temple in Karnataka collapsed following torrential rains. Located at the historical site of Hampi, the temple’s pavilion or the saalu mantap was damaged, leading some conservationists to blame Archaeological Survey of India (ASI) officials for allegedly neglecting its protection and conservation.

Background:

• A nationally protected monument, the temple is believed to have its origins in the 7th century.

Key Takeaways

• Virupaksha Temple is located in Hampi in the Vijayanagara district of Karnataka, India. It is part of the Group of Monuments at Hampi, designated as a UNESCO World Heritage Site.
• The temple is dedicated to Lord Shiva, known here as Virupaksha/Pampa pathi, as the consort of the local goddess Pampadevi who is associated with the Tungabhadra River.
• Despite legends about its origins going further back, the Virupaksha temple gained prominence and underwent extensive expansion in the 14th century during the Vijayanagara Empire (1336 to 1646).
• Founded by Harihara I of the Sangama dynasty, the Vijayanagara empire expanded from a strategic position on the banks of the Tungabhadra river to become one of the most powerful kingdoms of its time.
• The temple flourished under the patronage of the Vijayanagara rulers, who were great builders and patrons of art. It became a vital centre for the religious and cultural activities of its time.
• It is a prime example of Dravidian temple architecture, characterised by its grand gopurams (towering gateways), the shikhara towering over the sanctum sanctorum, its intricate carvings and pillared halls. Richly adorned with carvings and sculptures, the gopuram depicts various deities, mythological scenes and animals.
• Virupaksha Temple complex is surrounded by three gopuras (towers). The main tower, on the east is an imposing structure, 9 stories, 50 meters tall, built in the fifteenth century. Eastern tower forms the main entrance to Virupaksha Temple. Eastern tower has extensive craftsmanship on each of its floors featuring hundreds of Hindu gods and goddesses. The inverted shadow of the main tower falls on a wall inside the temple.
• With several other temples and structures located there, Hampi was the empire’s capital city. Hampi sits on the banks of the Tungabhadra River

Source: Indian Express

Syllabus

• Prelims – Current Event

Context: In a noteworthy international development, the International Criminal Court (ICC)’s prosecutor, Karim Khan, has requested the court to issue arrest warrants against leaders of Israel — Prime Minister Benjamin Netanyahu and Defence Minister Yoav Gallant — and leaders of Hamas.

Background:

• The arrest warrants are sought on the charges of war crimes and crimes against humanity over the October 7 attack on Israel and the subsequent war in Gaza.

About INTERNATIONAL CRIMINAL COURT :

• It is an intergovernmental organization and international tribunal that sits in The Hague, Netherlands.
• It has jurisdiction to prosecute individuals for the international crimes of: genocide, crimes against humanity, war crimes, crime of aggression.
• It is intended to complement existing national judicial systems.
• It may exercise its jurisdiction only when national courts are unwilling or unable to prosecute criminals.
• It may only investigate and prosecute crimes committed within member states, crimes committed by nationals of member states, or crimes in situations referred to the Court by the United Nations Security Council.The ICC lacks universal territorial jurisdiction.
• Israel is not a member of the court and does not recognise its jurisdiction, but the Palestinian territories were admitted with the status of a member state in 2015.
• Established in 2002 pursuant to the multilateral Rome Statute, the ICC is considered by its proponents to be a major step toward justice.

About the development

• The ICC, in recent times, has come under scathing criticism for targeting leaders of the third world, and not Western powers and their allies.
• The application to issue arrest warrants against the leaders of Israel, thus, is a first and quite significant one. It can be argued that by charging both the Hamas leadership and the Israeli leaders, the prosecutor is seemingly giving an impression of being balanced and even-handed.
• Under international law, heads of state are immune from criminal proceedings at any foreign or international court. At the ICC, however, no head of state can claim immunity.
• ICC statute says that “official capacity as a head of state or government, a member of a government or parliament, an elected representative or a government official shall in no case exempt a person from criminal responsibility”. It is because of this provision that the court, in 2023, was able to issue an arrest warrant against Russian President Vladimir Putin for his role in Russia’s war with Ukraine.
• Like Russia, Israel, too, isn’t a member of the ICC. Thus, some are questioning if the ICC can issue arrest warrants for Israeli leaders.
• The basis of ICC’s jurisdiction in this case is that Palestine is a state party to the court. Thus, the ICC can exercise what is known as territorial jurisdiction. This means that if a crime is committed on the territory of a state party to the ICC, the Court can exercise jurisdiction on that crime, even if it is committed by people belonging to a state that isn’t its member. Hence, the crimes committed by Israeli soldiers in Gaza fall within the Court’s jurisdiction.
• Similarly, Hamas’ conduct in Israel falls within the Court’s jurisdiction even though Israel isn’t a member of the ICC.
• There is generally a long road from requesting an arrest warrant to actual prosecution. The ICC’s track record is not quite encouraging, especially regarding heads of states. Take the example of Omar al-Bashir, former Sudanese President. ICC issued an arrest warrant against him way back in 2009. At the time, he was the president of Sudan. In 2019, he was ousted from office in a military coup. However, he has still not surrendered to the court. Likewise, while the arrest warrant against Putin has undoubtedly limited his international travels, his surrender to the ICC seems unlikely.

Source: Indian Express

Syllabus

• Mains – GS 3

Context: The Supreme Court has stopped the issuance of new mining licenses and renewals for existing ones in the Aravalli ranges and hills based on a report by the Forest Survey of India (FSI).

Background:

• “The court made it clear that its order should not be construed as a ban on legal mining activities carried out through valid permits and licences.”

The Aravalli Range:

• The Aravallis are one of the oldest fold residual mountains of the world comprised primarily of folded rock strata. This formation resulted from the convergence of tectonic plates during the Proterozoic Era (2500-541 million years ago)
• The Forest Survey of India (FSI) report, defined the Aravallis to include the hills and a uniform 100-meter-wide buffer zone around the downsides of the hills.
• They have an elevation of 300m to 900m. The mountains are divided into two main ranges – the Sambhar Sirohi Range and the Sambhar Khetri Range in Rajasthan.
• Guru Shikhar Peak on Mount Abu is the highest peak in the Aravalli Range (1,722 m).
• Major tribal communities include the Bhil, Bhil-Meena, Meena, Garasia, and others.
• The Supreme Court in 2009 ordered a complete ban on mining in the Aravalli hills of Faridabad, Gurgaon, and Nuh districts of Haryana.

Significance of the Aravalli Range:

• It provides habitat to 300 native plant species, 120 bird species, and many exclusive animals like the jackal and mongoose.
• It acts as a barrier between the fertile plains in the east and the Thar desert in the west.
• The excessive mining in the Aravalli Range is linked to the spread of the Thar Desert. The presence of loess, a desert windblown sediment, found in Mathura and Agra suggests that the desert is expanding due to the weakened ecological barrier created by the degraded Aravalli Hills.
• It plays a significant role in shaping the climate of northwest India. During the monsoon season, these mountains act as a climatic barrier, guiding moisture-laden south-westerly winds towards Shimla and Nainital. This, in turn, helps nourish the sub-Himalayan rivers and contributes to the rainfall that replenishes the vast north Indian plains.
• In the winter months, it protects the fertile alluvial river valleys from the cold westerly winds from Central Asia.

Issues/Concerns Related to the Mining in the Aravalli Range:

• Mining activities break and destroy Aravalli ecosystems, displacing wildlife like leopards, hyenas, and various bird species. This disrupts food chains and ecological balance.
• Mining in Rajasthan’s ecologically sensitive areas has threatened the habitat of the Great Indian Bustard, a critically endangered bird species.
• The Aravallis acts as a natural water reservoir. Mining disrupts natural water flow and table recharge, leading to water scarcity downstream, and impacting agriculture and human settlements. A 2018 research paper noted a decline in spring recharge due to mining in Haryana.
• Mining activities generate dust and release harmful pollutants like silica, affecting air quality and causing respiratory problems in nearby communities.
• Mining removes vegetation cover, exposing the soil to erosion. Wind and rain wash away fertile topsoil, leading to desertification. A study by the Centre for Science and Environment (CSE) revealed a 37% decline in forest cover in the Aravalli region of Haryana between 2001 and 2016, likely linked to mining activities.

Source: Hindu

Q1.) Consider the following statements with respect to Trade Deficit

1. A rising trade deficit can cause the country’s currency to appreciate.
2. Reducing a trade deficit involves a combination of increasing exports and decreasing imports.
3. A trade deficitis also referred to as a negative balance of trade.

How many of the statements given above are correct?

1. Only one
2. Only two
3. All three
4. None

Q2.) Consider the following statements about International Criminal Court

1. Russia & Israel are not members of the ICC.
2. It was established in 2002 pursuant to the multilateralRome Statute.
3. It is also known as the world court.

How many of the statements given above are correct?

1. Only one
2. Only two
3. All three
4. None

Q3.) Consider the following statements about Sensex and NIFTY

1. The Sensex is reconstituted biannually.
2. Sensex constitutes 30 companies trading on the National Stock Exchange of India (NSE).

Which among the statements given above is/are correct?

1. 1 only
2. 2 only
3. Both 1 & 2
4. Neither 1 nor 2

Comment the answers to the above questions in the comment section below!!

ANSWERS FOR ’  28th  May 2024 – Daily Practice MCQs’ will be updated along with tomorrow’s Daily Current Affairs.st

Q.1) – c

Q.2) – a

Q.3) – c